vpFREE2 Forums

A silly, simple question that shows my ignorance

#1

Thanks, Dan!

What you're saying is, the simplified formula you printed in VPT several
years back was way off! And here I've been using it for at least five years!
Luckily, I haven't gone broke!

Is perhaps AA an exception? I've never played it. I have also never played
FPKBJW. My friend uses the Sorokin formula to calculate ROR, and his figures
have never been very far off from the approximated figure gleaned from the
"short cut" you printed in VPT. Perhaps it works for "most" games, and I've been
fortunate to not play any of the exceptions?

My apologies to PartTimeVP. It seems you were correct! Live and learn!

Brian

···

----------------------------------------------------------------------

In a message dated 8/22/2005 5:11:00 PM Pacific Standard Time,
Dan@OptimumPlay.com writes:

Brian (bjaygold@aol.com) wrote:

I believe that the variance number can be used "directly" when calculating
ROR (risk of ruin) bankrolls. That is, ROR bankroll is directly
proportional to
variance. Is this not so? If it is so, that seems to be a pretty useful

way

to use the variance number--I have used it that way for many years.

Sorry, but that's not a very good approximation. For example, let's
compare two popular games that are over 100% payback, full pay Deuces
Wild, and full pay All American. I'll assume we start with a bankroll
of 10,000 unit bets and play perfect strategy on both games.

DW 100.762% variance = 25.9 RoR = 0.1487%

AA 100.722% variance = 26.8 RoR = 0.2765%

Thus, even though the variance for All American is only slightly
greater than for Deuces Wild, and the payback is very close, the Risk
of Ruin is more nearly twice as great. For Joker Wild (kings) the RoR
is more than three times that of Deuces Wild even though the variance
is less than for All American at 26.2.

As far as I know, the Sorokin formula is the only way to get a
reasonable handle on Risk of Ruin.

[Non-text portions of this message have been removed]

#2

I'm jumping into the middle of this, so not sure I understand all the
questions.

The approximate formula is: variance/(er-1)
That's the Kelly bankroll and it has an ror of around 11%.

The "Sorokin" formula is R(1)=R(1)^(Prob x Win) summed for each win
including win nothing, it's recursive, so you solve it recursively, a
spreadsheet will do the trick. This number is exact (limited by the
probability and calculation precision).

For FPDW:
Kelly bankroll = 25.83461805/(1.007619612-1) = 3391 bets
R(1)= 0.999346832571955, ror for any bankroll = R(1)^bankroll
11%ror bankroll= ln(0.11)/ln(R(1) = 3378 bets

For FPAA:
Kelly bankroll = 26.79979685/(1.007220753-1) = 3711 bets
R(1)= 0.99941069150546
11%ror bankroll= ln(0.11)/ln(R(1) = 3744 bets

For FPJoker:
Kelly bankroll = 26.24501029/(1.006462974-1) = 4061 bets
R(1)= 0.999463345797305
11%ror bankroll= ln(0.11)/ln(R(1) = 4112 bets

Thanks, Dan!

What you're saying is, the simplified formula you printed in VPT

several

years back was way off! And here I've been using it for at least

five years!

Luckily, I haven't gone broke!

Is perhaps AA an exception? I've never played it. I have also never

played

FPKBJW. My friend uses the Sorokin formula to calculate ROR, and his

figures

have never been very far off from the approximated figure gleaned

from the

"short cut" you printed in VPT. Perhaps it works for "most" games,

and I've been

fortunate to not play any of the exceptions?

My apologies to PartTimeVP. It seems you were correct! Live and

learn!

···

--- In vpFREE@yahoogroups.com, bjaygold@a... wrote:

Brian

------------------------------------------------

----------------------

In a message dated 8/22/2005 5:11:00 PM Pacific Standard Time,
Dan@O... writes:

Brian (bjaygold@a...) wrote:
>I believe that the variance number can be used "directly" when

calculating

>ROR (risk of ruin) bankrolls. That is, ROR bankroll is directly
>proportional to
> variance. Is this not so? If it is so, that seems to be a pretty

useful

way
>to use the variance number--I have used it that way for many

years.

Sorry, but that's not a very good approximation. For example,

let's

compare two popular games that are over 100% payback, full pay

Deuces

Wild, and full pay All American. I'll assume we start with a

bankroll

of 10,000 unit bets and play perfect strategy on both games.

DW 100.762% variance = 25.9 RoR = 0.1487%

AA 100.722% variance = 26.8 RoR = 0.2765%

Thus, even though the variance for All American is only slightly
greater than for Deuces Wild, and the payback is very close, the

Risk

of Ruin is more nearly twice as great. For Joker Wild (kings) the

RoR

is more than three times that of Deuces Wild even though the

variance

is less than for All American at 26.2.

As far as I know, the Sorokin formula is the only way to get a
reasonable handle on Risk of Ruin.

[Non-text portions of this message have been removed]

#3

I have used something very similar as well for years.... Is it really that far off?

···

----- Original Message ----- From: <bjaygold@aol.com>
To: <vpFREE@yahoogroups.com>
Sent: Monday, August 22, 2005 8:39 PM
Subject: Re: [vpFREE] Re: Re: A silly, simple question that shows my ignorance

Thanks, Dan!

What you're saying is, the simplified formula you printed in VPT several
years back was way off! And here I've been using it for at least five years!
Luckily, I haven't gone broke!

Is perhaps AA an exception? I've never played it. I have also never played
FPKBJW. My friend uses the Sorokin formula to calculate ROR, and his figures
have never been very far off from the approximated figure gleaned from the
"short cut" you printed in VPT. Perhaps it works for "most" games, and I've been
fortunate to not play any of the exceptions?

My apologies to PartTimeVP. It seems you were correct! Live and learn!

Brian